Bob Iger boomerangs as Disney CEO: What success looks like this time
As a boomerang CEO, Disney's Bob Iger has a lot to address to please investors banking on his leadership and execution magic working one last time to fix the struggling media giant.
Disney announced late Sunday that Iger will return to lead the company as its chief executive officer, effective immediately. Iger led Disney as CEO from 2005 to 2020, and is credited with big-time acquisitions such as LucasFilm and his graceful leadership style.
Iger replaces his now-ousted hand-picked successor, Bob Chapek, who was taking on heavy fire from investors for a bad earnings miss earlier this month and several operational miscues.
Disney stock popped on the news. The company was the most active ticker page on Yahoo Finance through morning trading.
Success for Iger this go around will likely require a few of key moves.
First, Citi Managing Director Jason Bazinet told Yahoo Finance Live (video above), Iger should consider resetting long-term financial expectations for Disney+. Doing so would allow him to stabilize Disney's business and then drive upside as the potential turnaround gains hold.
"They may like they need to lower the [streaming] 2024 expectations that they have given the Street," Bazinet said. "They may know they are not going to hit those or breakeven by the fourth quarter of 2024. If you are going to to make an announcement like that, you are going to want to have someone of Mr. Iger's caliber to make it more palatable."
Second, according to Bazinet, Iger should look to make more acquisitions to bolster Disney's scale even further. That doesn't mean selling off cash cow ESPN, however, as activist investor Third Point has contended.
"When they came out with that [idea on ESPN], we just said that is the dumbest idea ever — it generates a lot of their cash flow," Bazinet noted.
Expectations are riding high that Iger rekindles his CEO magic at Disney. If he does, it would resemble the impressive return act as CEO as his friend Steve Jobs at Apple.
A worst-case scenario would look like Jack Dorsey. Dorsey was pushed out of Twitter in 2008, returned in 2015, and then left in 2021 after several poor quarters and an attack by activist Elliott Management.
Leadership experts say Iger is likely to crush over the next two years as Disney's CEO.
"Iger has the right touch at Disney," leadership expert and former Medtronic CEO Bill George said on Yahoo Finance Live. "And I don't think Chapek had that touch at all. And you know, this is a creative industry. And you have to know how to handle the true innovators."
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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